What does it mean when your car’s written off ?

Not all write-off cars look like crumpled hunks of metal. In fact, some don’t look as if they’ve been in an accident or damaged at all, which can make the term ‘write-off’ seem confusing. Here, mustard.co.uk, experts at helping you find cheap car insurance in the uk explain how car write-offs work. They also share what you can do if you don’t agree with your insurer’s decision to send your car to the scrapyard.

What is a car insurance write-off?

As far as insurers are concerned, a write-off is any car that’s simply too expensive to fix in relation to its market value.

To work out whether or not a car should be written off, insurers use something called a ‘repair-to-value’ ratio. It’s up to insurers to decide what ratio they use, but it’s usually 50% or 60%. If the repairs needed exceed that percentage value, the car will be declared a write-off. For example, if your insurer works to a ratio of 50% and your car’s current value is £12,000, it’s likely to be a write-off if it needs at least £6,000 worth of repairs.

Of course, cars that have been in accidents will have been impacted in different ways, which is why there are four main categories of write-off:

• Category A – if your car falls into cat A, it will have sustained considerable damage and cannot be made safe or repaired. These cars will ultimately be completely scrapped.
• Category B – your car will have extensive damage and while the body will be scrapped, there may be some parts that can be sold as salvage.
• Category S – the ‘S’ stands for structural damage so although these cars will need significant repairs, they can be fixed. If you decide to save your cat S car from the scrap heap, it will need to be professionally repaired and re-registered with the DVLA. This category was previously known as cat C.
• Category N – the ‘N’ stands for non-structural damage so these cars might not look like they’ve been in an accident at all and seem relatively unscathed. However, there could be electrical damage that makes the car too expensive to fix. This category was previously known as cat D.

What will happen if my car is a write-off?

If your car is a write-off, your insurer will compensate you for it according to its current market value. If you think the amount you’ve been offered is too low, you can ask the Financial Ombudsman Service to take a look at your case. They’ll investigate matters impartially and their services are free.

If you’ve bought a car insurance policy that covers new for old, then you’ll get more compensation than you would with a standard policy. If this is the case, the pay out you get should be enough to cover the cost of a new car of the same make and model as the one that’s been written off.

Can I challenge the decision to write-off my car?

Yes, you can. But remember that your insurer will have based their decision on the current market value of your car and not the amount you paid for it. If you strongly believe your insurer has incorrectly valued it, you should be prepared to show why you think this. For instance, you could compare it to cars of the same make and model advertised in the classifieds.

If you make an unsuccessful appeal and want to pursue the matter, you can take your case to the Financial Ombudsman Service.

Can I buy back my written-off car?

You can only offer to buy back cat S or N cars which can be repaired and made safe again. If you do, the scrappage value will be deducted from the compensation you get.

If you think you might want to buy your car back, you should let your insurer know as soon as possible.

What happens if my car’s written off but I haven’t paid for it in full?

If you have a finance plan and haven’t finished paying for your car, you might find the compensation you receive isn’t quite enough to pay off the car loan. If this happens, you can try and negotiate your insurance payout, but you’ll need evidence to show why you think your car is worth more (for instance, using car ads as examples). If not, you should speak to the car finance agency and discuss your options with them.

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